ITAT Dismisses Penalty Appeal as Withdrawn After Opting for Vivad Se Vishwas Scheme [Read Order]

The bench of the Income Tax Appellate Tribunal, Raipur, dismissed an appeal concerning penalty under Section 271(1)(b) of the Income Tax Act, 1961. The dismissal followed the appellant’s decision to opt for resolution under the Direct Tax Vivad Se Vishwas Scheme, 2024.

The appeal was filed by Rakesh Kumar, resident of Bhilai, against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Center, Delhi [CIT(A], dated 20 September 2024. The matter originated from the Assessing Officer’s (AO) order dated 30 August 2022 imposing penalty under Section 271(1)(b) of the Income Tax Act, 1961, for the Assessment Year 2014-15.

Represented by Sakshi Gopal Agrawal, the appellant submitted a letter dated 13 January 2025 stating that he had opted for the Vivad Se Vishwas Scheme, 2024 to settle the dispute. Furthermore, a record of “Form-1” filed as per Rule 4 of the Direct Tax Vivad Se Vishwas Rules, 2024. It was also urged to seek adjournment, citing that “Form-2” was yet to be issued under the scheme.

Represented by Anubhaa Tah Goel, the Revenue raised no objection to the withdrawal of the appeal in light of the appellant’s choice to proceed under the settlement scheme.

The Bench comprising of Judicial Member, Ravish Sood and Accountant Member, Arun Khodpia ruled that since the appellant had initiated the process of settling the tax dispute through the Direct Tax Vivad Se Vishwas Scheme, the appeal no longer required adjudication on merits.

It was further clarified that if the designated authority did not pass a final settlement order in “Form-4,” the appellant would be at liberty to seek restoration of the appeal.

The Tribunal, therefore, dismissed the appeal as withdrawn.

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